What is the Cairn tax dispute about? What did the Permanent Court of Arbitration rule in December 2020?
The story so far: In December 2020, a three-member tribunal at the Permanent Court of Arbitration in the Netherlands ruled against India in its long-running tax dispute with the U.K.-based oil and gas company Cairn Energy Plc and a subsidiary, Cairn UK Holdings Ltd. The tribunal ordered India to pay about $1.4 billion to the company. Following this, Cairn Energy has successfully moved courts in five countries, including the United States and the United Kingdom, to recognise its claim as per the arbitration award, according to PTI. The Netherlands, France, and Canada are the other three countries. Such a recognition by courts opens the door for Cairn Energy to seize assets of the Indian government in these jurisdictions by way of enforcing its claim, in case the latter doesn’t pay its dues.
What is the dispute about?
The dispute started in early 2014 when Indian tax…